SanDisk 2010 Annual Report Download - page 207

This is a TAB type table. Insert
conts here. Annual Report
Notes To Consolidated Financial Statements
Warranties. The liability for warranty expense is included in Other current accrued liabilities and
Non-current liabilities in the accompanying Consolidated Balance Sheets and the activity was as follows (in
thousands):
January 2,
2011
January 3,
2010
December 28,
2008
Balance, beginning of period .................................... $ 25,909 $ 36,469 $ 18,662
Additions and adjustments to cost of product revenues ............ 30,732 23,129 74,282
Usage .................................................. (31,939) (33,689) (56,475)
Balance, end of period ......................................... $ 24,702 $ 25,909 $ 36,469
The majority of the Company’s products have a warranty of less than three years with a small number of
products having a warranty ranging up to ten years. A provision for the estimated future cost related to warranty
expense is recorded at the time of customer invoice. The Company’s warranty liability is affected by customer
and consumer returns, product failures, number of units sold, and repair or replacement costs incurred. Should
actual product failure rates, or repair or replacement costs differ from the Company’s estimates, increases or
decreases to its warranty liability would be required.
Accumulated Other Comprehensive Income. Accumulated other comprehensive income presented in the
accompanying Consolidated Balance Sheets consists of unrealized gains and losses on available-for-sale
investments, foreign currency translation and hedging activities, net of tax, for all periods presented (in
thousands):
January 2,
2011
January 3,
2010
Accumulated net unrealized gain on:
Available-for-sale investments ......................................... $ 17,505 $ 27,192
Foreign currency translation ........................................... 231,255 98,424
Hedging activities ................................................... 11,468 3,097
Total accumulated other comprehensive income ............................... $ 260,228 $ 128,713
The amount of income tax (benefit) expense allocated to unrealized gain on available-for-sale investments,
hedging activities and foreign currency translation for each of the three fiscal years ended was as follows (in
thousands):
January 2,
2011
January 3,
2010
December 28,
2008
Available-for-sale investments ................................... $ (6,176) $ 13,705 $ (5,867)
Foreign currency translation ..................................... 23,095 (5,315) 36,657
Hedging activities ............................................. (2,777) (11,588) 10,205
$ 14,142 $ (3,198) $ 40,995
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